Nigeria’s agri-tech startup ThriveAgric has raised $56.4M in debt funding from local commercial banks and institutional investors to grow its 200,000+ farmer base, and expand into new African markets.
The raise also included a co-investment grant of $1.75M from the USAID-funded West Africa Trade & Investment.
Founded in 2017 (and fully operational since 2018), ThriveAgric empowers farmers in Nigeria to sell their products to FMCGs and food processors, leveraging its proprietary technology to access finance as well as improve productivity and sales to promote food security, The technology, an Agricultural Operating System (AOS), works entirely offline, dispatches USSD to farmers, and powers Android apps used by field agents to help digitally collate creditworthy farmers and gather relevant farm data.
This latest funding follows $9m the company raised in 2020. Over the past 12 months, ThriveAgric’s revenues have increased five-fold, with a year-on-year increase of 277% in farmer numbers. The strong margin performance was boosted by farmers using the company’s AOS proprietary product.
The company supports Africa’s agriculture sector by assisting smallholder farmers in producing high-quality grains. Harvests, including maize, rice and soybeans, are stored in many of the company’s 450+ warehouses in Bauchi, Jigawa, Kaduna, Kano and Katsina states in Nigeria, before being commoditized and offered to local and global trade markets at a premium price.
“The new investment takes us one step closer to fulfilling our mission of building the largest network of profitable African farmers using technology, to ensure food security. We look ahead with renewed confidence knowing that our smallholder farmers will benefit financially even more from this new investment ” ThriveAgric Chief Executive Officer Uka Eje, said.
“It is great to see that the market has overwhelmingly backed our farmers and they are confident in the strategic decisions we have taken. ThriveAgric has increased its footprint to 20 states in Nigeria, and we look forward to a lengthy period of growth as we continue to link African farmers to capital, data driven best practices and access to local and global markets for their commodities.” he added.
Smallholder farmers constitute over 80% of the Nigerian agriculture industry. Access to finance, advisory, and markets are significant barriers. Nearly 72% live below the poverty line on less than $1.90 a day.
Farmers assisted by ThriveAgric can charge premium rates for their commodities, allowing them to increase their incomes up to 25 percent. At the height of the global pandemic, business and supply disruptions prevented ThriveAgric from fulfilling obligations to its subscribers, leading to swift appointments of key personnel, including Olurotimi Arigbede, Chief Financial Officer and Michael Kadiri, Head of Risk Management and Compliance. Under the strengthened management structure, the company settled all outstanding disputes with subscribers.
ThriveAgric Co-founder and CTO, Ayo Arikawe, said, “ThriveAgric’s fundraising objectives are geared towards growth through vertical and horizontal integration. One of our goals is to be able to widen access to markets for our smallholder farmers, help to lift them out of poverty, and ultimately promote food security. We do this by enabling them to take their produce to local and international markets. We’re thrilled and excited to receive support from such high calibre investors. Their financial backing is an essential step in fulfilling ThriveAgric’s vision to build an Africa that feeds herself and the world.”
The firm plans to expand its operations to Ghana, Zambia and Kenya.